---
title: "Focus on Sustainable Finance: Telecom companies focus on climate protection "
url: https://www.helaba.com/en/focus-sustainable-finance-telecom-companies-focus-climate-protection
type: dd_research
language: en
updated: 2026-09-28
keywords: Credit, Credit Special
---

# Focus on Sustainable Finance: Telecom companies focus on climate protection 

Focus on: Sustainable Finance 17 December 2024 © Helaba | Research & Advisory | 17 December 2024 1 of 6 Research & Advisory Telecom companies focus on climate protection in their sus- tainability strategy and sustainable finance activities Climate protection is a central issue in the sustainability strategies of many companies, especially in the telecom industry. Future growth and the reduction of greenhouse gas emissions must be reconciled in order to remain successful in the long-term. Therefore, all major telecom companies have developed by now a detailed climate strategy and cor- responding reduction targets for CO2 emissions. These include not only the emissions caused within the company itself (Scope 1 & 2), but also those of the value chain from the supplier to the end customer (Scope 3). Numerous telecom companies have already linked the targeted decarbonisation with their financing activities by using sustainability- linked structures, which link interest costs to CO2 reduction targets, or earmarked green bonds. The Corporate Sustainability Reporting Directive (CSRD) will refine and expand sustainability reporting. This makes differences in the development of the carbon foot- print for individual companies more visible and simplifies linking climate protection with financing measures. Greenhouse gas emissions at the centre of the sustainability strategies The Corporate Social Responsibility Directive (CSRD) requires reporting companies to carry out a materiality analysis. By surveying relevant stakeholders such as customers, employees, suppliers, banks and investors, the most important interactions between the company, the environment and society become identified. Our analy- sis of sustainability reports from major European telecom companies shows that the topic of "climate protec- tion" poses a central success factor for the industry. In this regard, companies find themselves in a field of ten- sion. On the one hand, it is essential to rapidly reduce greenhouse gas emissions. On the other hand, growth opportunities fuelled by developments in the field of artificial intelligence and increasing digitalisation are linked to a further increase in data volume and energy consumption. Therefore, growth and emissions need to be decoupled from each other. Thanks to the Greenhouse Gas Protocol, progress on this path can be tracked using an internationally recognised standard for calculating greenhouse gas emissions. Indirect emissions are the main lever for reduction The Greenhouse Gas Protocol divides emissions into three categories: Scope 1 comprises the direct emissions from sources that are controlled by a company. These include, for example, the fuel consumption for vehicles, the consumption of fossil fuels for heating or refrigerants for cooling systems. For telecom companies, Scope 1 amounts to an average of around 3 % of total emissions. Scope 2 comprises the indirect emissions resulting from the production of purchased energy. This mainly relates to purchased electricity, particularly for fixed and mobile networks, data centres and buildings. It is possible to calculate Scope 2 using the location-based or mar- ket-based method. While with the location-based method the consumed electricity is assigned the average emis- sions intensity of the respective electricity grid, the market-based method calculates with contract-specific emis- sions factors provided by the electricity supplier. Most companies report Scope 2 according to both methods and therefore also provide information on the volume of emissions saved by intentionally purchasing climate-neutral electricity. Deutsche Telekom, for instance, reported a total of 3,979 kilotons of CO2 for 2023 using the location- Dr. Haiko Stefan Sustainable Finance Advisory T: +49 69 / 91 32 - 79 63 Focus on: Sustainable Finance © Helaba | Research & Advisory | 17 December 2024 2 of 6 based method. Since it has been sourcing its electricity exclusively from renewable sources since 2021, the mar- ket-based emissions were only 18 kilotons and attributable to indirect emissions from district heating. On aver- age, Scope 2 (location-based) and Scope 2 (market-based) amount to around 19 % and 7 %, respectively. With an average share of around 78 %, Scope 3 makes up the largest part of the industry's carbon footprint and includes all indirect emissions arising in the value chain. Due to the numerous activities in the value chain, the Greenhous Gas Protocol divides Scope 3 into 15 categories. The most important categories are "Purchased goods and services", "Capital goods" and "Use of sold products".1 While the first two are reported at times on an aggregated level and account for an average of around 76 % of total emissions, the share of the last category amounts to around 12 %. The category "Purchased goods and services" contains, for instance, emissions from procured WLAN routers and mobile phones which arose during their production processes. The purchase of mobile phone towers, buildings, vehicles or equipment for data centres, on the other hand, falls into the category "Capital goods". The category "Use of sold products" contains the emissions of products which arise during their use phase. These are generated by the end customer through the electricity consumption of WLAN routers, mobile phones, set-top boxes and other devices.  1 The companies A1, Proximus and TDC Net do not report any volume for the category "Capital goods" since the respective amount is added to the category "Purchased goods and services". 199 260 372 90 122 104 24 9 21 27 13 1 4 8 18 660 716 439 215 232 205 0 97 0 0 0 2 25 10,477 7,804 7,095 2,379 1,971 1,929 1,211 759 584 524 307 273 269 84 10,694 8,724 8,184 2,908 2,308 2,265 1,441 768 702 551 320 275 275 117 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Emitted emissions (Scope 1, 2 and 3) Emissions in kT for 2023 Scope 3 Scope 2 (marked-based) Scope 1 Sources: Companies‘ websites, Helaba Research & Advisory Focus on: Sustainable Finance © Helaba | Research & Advisory | 17 December 2024 3 of 6 Reduction pathways already reviewed by Science Based Targets initiative (SBTi) All major European telecom companies have by now developed their own climate protection strategies and set corresponding targets for the reduction of emissions. In order to emphasize the credibility of these reduction paths and make the undertaken efforts transparent, most of them also joined the Science Based Targets initiative (SBTi), which independently reviews climate protection targets on a science-based basis for compliance with the 1.5°C target of the Paris Agreement. The short-term targets up to 2030 show that separate targets are often set for Scope 1 and 2 as well as for Scope 3 and that these mostly relate to a reduction in absolute CO2 emissions. In some cases, targets are solely set on an aggregated level and contain Scope 1, 2 and 3. 2,3 Scope 1 & 2 | Short-term targets Company Date of publication Base year Target year Reduction Reduction p.a. absolute / intensity KPN 2024 Sep 2015 2030 84 % 5.6 % absolute Telenor 2024 Jun 2019 2030 64 % 5.8 % absolute Orange 2024 Jun 2021 2030 45 % 5.0 % absolute iliad 2024 Mar 2022 2030 60 % 7.5 % absolute Deutsche Telekom 2024 Feb 2020 2030 94 % 9.4 % absolute Swisscom 2024 Feb 2018 2030 80 % 6.7 % absolute Vodafone 2023 Oct 2020 2030 90 % 9.0 % absolute Elisa 2023 Mar 2021 2030 42 % 4.7 % absolute Proximus 2022 Sep 2020 2030 95 % 9.5 % absolute TDC Net 2022 Aug 2020 2028 60 % 7.5 % absolute Tele2 2022 Aug 2019 2025 90 % 15.0 % absolute Telefonica 2022 Aug 2015 2030 80 % 5.3 % absolute TIM 2022 Jun 2019 2030 75 % 6.8 % absolute A1 2020 Sep 2019 2030 50 % 4.5 % absolute Average 72.1 % 6.7 % Sources: Science Based Targets initiative, companies’ websites, Helaba Research & Advisory  2 The values shown in the table "Scope 1 & 2 | Short-term targets" for Elisa, TDC Net and Orange relate to Scope 1, 2 and 3, whereas the values shown for KPN relate to Scope 1. 3 The values shown in the table "Scope 3 | Short-term targets" for Elisa and TDC Net relate to Scope 1, 2 and 3. 4,126 1,428 2,989 1,301 1,027 1,304 273 378 405 450 224 165 147 71 2,150 825 2,316 462 227 548 493 209 3 79 36 1,362 1,128 193 81 579 76 307 20 145 2 34 21 50 3 2,836 4,423 1,598 535 138 138 153 34 72 46 9 37 10 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Emitted emissions (Scope 3) Emissions in kT for 2023 Purchased goods and services Capital goods Use of sold products Other Sources: Companies‘ websites, Helaba Research & Advisory Focus on: Sustainable Finance © Helaba | Research & Advisory | 17 December 2024 4 of 6 The target values for Scope 3 relate predominantly to the reduction of absolute emissions and rarely to emis- sions intensity (e.g. measured by the number of customers). However, the perimeter of Scope 3 is occasionally limited to the most important categories when setting targets. For example, Telecom Italia Mobile's (TIM) target is only based on the categories "Purchased goods and services", "Capital goods" and "Use of sold products". Scope 3 | Short-term targets Company Date of publication Base year Target year Reduction Reduction p.a. absolute / intensity Restriction to certain categories KPN 2024 Sep 2015 2033 75.6 % 4.2 % absolute No Telenor n.a. n.a. n.a. n.a. n.a. n.a. n.a. Orange 2024 Jun 2021 2030 74 % 8.2 % intensity Yes Iliad 2024 Mar 2022 2030 46 % 5.8 % absolute No Deutsche Telekom 2024 Feb 2020 2030 47 % 4.7 % absolute No Swisscom 2024 Feb 2018 2030 60 % 5.0 % absolute No Vodafone 2023 Oct 2020 2030 50 % 5.0 % absolute No Elisa 2023 Mar 2021 2030 42 % 4.7 % absolute No Proximus 2022 Sep 2020 2030 60 % 6.0 % absolute No TDC Net 2022 Aug 2020 2028 60 % 7.5 % absolute No Tele2 2022 Aug 2019 2029 60 % 6.0 % intensity No Telefonica 2022 Aug 2016 2030 56 % 4.0 % absolute No TIM 2022 Jun 2019 2030 47 % 4.3 % absolute Yes A1 2020 Sep 2019 2030 50 % 4.5 % absolute Yes Average 56.0 % 5.0 % Sources: Science Based Targets, companies’ websites, Helaba Research & Advisory Measures for the reduction of Scope 1 and 2 are multifaceted Telecom companies often take similar measures to reduce emissions. Regarding Scope 1, the focus is primarily on increasing the share of electric vehicles in the current fleet and modernising buildings by, for instance, elec- trifying the heating system through implementing heat pumps. The measures for Scope 2 generally pursue two approaches, both of which relate to a company’s consumed electricity. The first approach aims at reducing elec- tricity consumption by renewing and optimising existing networks and technical equipment. An important meas- ure in this context is replacing copper cables with fibre optic cables. Companies are also optimising the power consumption of cooling systems in data centres by renewing their IT infrastructure in order to increase energy efficiency. In this regard, the power usage effectiveness (PUE) is used as a key performance indicator to measure progress. In addition, unused frequencies in fixed and mobile networks are put into standby mode as long as data traffic is at a low level. The second approach is based on the origin of the electricity purchased and focusses on buying electricity that is as emission-free as possible. In this context, power purchase agreements (PPAs) with providers that generate electricity from renewable energy sources, such as solar parks or wind turbines, and sup- ply it directly to the company play an important role. In order to counter the current shortage of PPAs, guaran- tees of origin are often purchased for a certain amount of electricity, which prove the generation of a MWh of electricity from renewable sources. In contrast to PPAs, such guarantees of origin are not linked to the physical supply of electricity and can therefore be traded separately. Suppliers are the focus for the reduction of Scope 3 Scope 3 relates to activities along the value chain, which is why the measures are implemented either upstream or downstream by the company. Telecom companies work together with suppliers to improve their manufactur- ing processes, logistics and procurement activities. For example, Wi-Fi routers are often equipped with recycled and recyclable components in order to increase life expectancy and reduce the use of materials. Suppliers are also incentivised to source renewable electricity and establish sustainable procurement processes. Another widespread measure is the membership of initiatives such as the Carbon Disclosure Project (CDP) or the Joint Alliance for Corporate Social Responsibility (JAC). Along the downstream value chain, telecom companies mainly focus on reducing the power consumption of Wi-Fi routers, mobile phones, set-top boxes and other devices at Focus on: Sustainable Finance © Helaba | Research & Advisory | 17 December 2024 5 of 6 the end customer. To this end, appropriate technical adjustments are already being made during the manufac- turing process. Customers also receive suitable apps that can be used to switch off end devices at set times or put them into standby mode. Numerous telecom companies combine decarbonisation targets with financing activities Several telecom companies have already linked their climate protection strategy with their financing activities. In this context, for example, the interest costs of sustainability-linked financings have been linked to the achieve- ment of CO2 reduction targets. In this regard, the SBTi target values were often used in order to emphasise their importance. These sustainability-linked financings appear predominantly in the credit sector and are rarely used in the bond sector where mainly earmarked structures are used. Regarding the bond sector, the use of proceeds is limited to projects having a clear environmental or climate benefit. In some cases, the proceeds are used to finance social projects in addition to environmental projects. The individual projects are divided into categories defined by the Green and Social Bond Principles of the International Capital Market Organisation (ICMA). If ear- marked financings are limited exclusively to ecological projects, they are labelled "green". However, if social pro- jects are also included, the classification changes to "Sustainability". The category "Energy efficiency" is regu- larly used in this context, including the replacement of copper cables with fibre optic cables and improvements in the energy efficiency of data centres. However, it is hardly possible to integrate the EU taxonomy into ear- marked financings, as it has only covered a few activities in the telecom sector to date. It remains to be seen whether this will change in the future. Sustainable financings of telecom companies in 2024 Company Date Instrument Volume (in millions) Structure Information iliad 2024 Oct Bond 500 EUR Green Categories | i) Energy efficiency, ii) Circular economy, iii) Clean transportation, iv) Renew- able energy iliad 2024 Aug Loan 3,000 EUR Sustainability-Linked KPIs | i) CO2 (Scope 1 & 2), ii) CO2 (Scope 3) Swisscom 2024 Aug Bond 100 CHF Green Categories | i) Energy efficiency, ii) Renewa- ble energy, iii) Clean transportation Telefonica 2024 Sep Bond 200 EUR Sustainability Categories | i) Energy efficiency, ii) Renewa- ble energy, iii) Data-driven solutions, iv) In- clusive connectivity KPN 2024 Jun Bond 500 EUR Green Categories | i) Energy efficiency, ii) Circular economy, iii) Clean transportation TDC Net 2024 Apr Bond 500 EUR Sustainability-Linked KPIs | i) CO2 (Scope 1 & 2), ii) CO2 (Scope 3) Elisa 2024 Apr Loan 100 EUR Sustainability-Linked KPIs | i) CO2 (Scope 1 & 2), ii) CO2 (Scope 3), iii) Digital inclusion Telefonica 2024 Mar Bond 1,100 EUR Sustainability Categories | i) Energy efficiency, ii) Renewa- ble energy, iii) Data-driven solutions, iv) In- clusive connectivity Telus 2024 Feb Bond 500 CAD Sustainability-Linked KPIs | i) CO2 (Scope 1 & 2) Vodafone 2024 Feb Revolving credit faci- lity 4,050 EUR Sustainability-Linked KPIs | i) CO2 (Scope 1 & 2), ii) CO2 (Scope 3), (…) Telefonica 2024 Jan Bond 1,750 EUR Sustainability Categories | i) Energy efficiency, ii) Renewa- ble energy, iii) Data-driven solutions, iv) In- clusive connectivity Sources: Bloomberg, companies’ websites, Helaba Research & Advisory Focus on: Sustainable Finance © Helaba | Research & Advisory | 17 December 2024 6 of 6 Completed CSRD implementation should give new impetus to sustainable finance activities Even if the transposition of the CSRD into national law in Germany is delayed due to the new elections in Febru- ary 2025, all companies active on the capital market are currently in the hot phase of preparations.4 In addition to the collection and preparation of additional data points, existing reporting systems and processes are often reviewed and optimised during this process. This generally involves a great deal of effort for the companies, which ties up a massive amount of human resources, especially in the sustainability departments. As a result, these resources are currently not available for preparing financing transactions. However, this bottleneck should be resolved as soon as the companies concerned publish their sustainability reports in accordance with the CSRD for the first time. At the same time, information gaps will be closed by reporting homogeneous and high-quality data. Differences in ESG performance will therefore become more visible to investors and are also likely to have a greater impact on decision-making processes. For companies with above-average ESG perfor- mance in particular, sustainable financing is therefore an effective means of emphasising this performance. For example, sustainability-linked structures make it possible to better explain the level of ambition of reduction targets to banks or investors and, if the targets are achieved, to benefit from financial benefits. Earmarked fi- nancing such as green bonds, on the other hand, help to focus on forward-looking investments in climate pro- tection and energy efficiency and to address investor groups with a corresponding focus. At the same time, the appetite among financial institutions for investments with the lowest possible carbon footprint is likely to in- crease, as they have to disclose the emissions they finance. As most telecom companies already have detailed decarbonisation strategies in place, this should further boost sustainable finance activities in the sector. Publisher and editor Helaba Research & Advisory Editor: Stefan Rausch Corporate Research & Advisory Publisher: Dr. Gertrud R. Traud Chief Economist/ Head of Research & Advisory Neue Mainzer Str. 52-58 60311 Frankfurt am Main T +49 69 / 91 32 - 79 63 Internet: www.helaba.com Disclaimer This publication was very carefully re- searched and prepared. However, it con- tains analyses and forecasts regarding cur- rent and future market conditions that are for informational purposes only. The data are based on sources that we consider relia- ble, though we cannot assume any respon- sibility for the sources being accurate, com- plete, and up to date. All statements in this publication are for informational purposes. They must not be taken as an offer or rec- ommendation for investment decisions.  4 Information on the implementation measures of EU member states Sign up for our newsletter here: https://news.helaba.de/research/

Climate protection is a focal point in the sustainability strategies of large telecoms companies. Detailed decarbonisation strategies already being implemented. Sustainable finance activities are focussing on CO2 reduction.